MISSOULA, MT -- (Marketwire) -- 04/30/12 -- Treasure State Bank ("the Bank") (OTCBB: TRSU), a Montana chartered community bank, today announced:
President and Chief Executive Officer Jim Salisbury stated, "I am pleased to report that we are reporting our fifth consecutive quarter of profitability. The $42,000 of profit for this quarter exceeds the $34,000 reported last quarter but is less than the $128,000 reported for the same quarter last year. The $86,000 reduction in earnings from the same period last year is due primarily to a reduction in net interest income of $45,000, an increase in non-cash option related expense of $30,000 and a reduction in fee income of $16,000 from the same period last year. The reduction in net interest income is a combination of a reduction in asset size of $4.6MM and a decrease in interest income related to $3.4MM of certain non-performing loans starting the fourth quarter of 2011. Once those loans again become performing interest income will improve. The Bank now has an allowance for loan losses to gross loans of 4.04% ($2.1MM) to act as a cushion to absorb potential losses on existing troubled loans. The Bank continues to work diligently to address non-performing assets. During the quarter ended March 31, 2012, the Bank sold $786,000 of real estate owned with no new additions to real estate owned. Total non-performing assets, which include $3.0MM of repossessed assets, decreased $300,000 during the quarter to $8.3MM as of March 31, 2012, down from $8.6MM as of December 31, 2011.
"In addition to the $42,000 in earnings for the quarter ended March 31, 2012, and in an effort to continue to build the capital ratios, assets have decreased $1.0MM to $76.0MM as of March 31, 2012, down from $77.0MM as of December 31, 2011. Gross loans have increased $400,000 to $51.0MM as of March 31, 2012, up from $50.6MM as of December 31, 2011. The Bank continues to lend to qualified borrowers and is actively seeking qualified borrowers. During the quarter just ended, the Bank originated $2.3MM in new loans.
"The Bank continues to work diligently to reduce its cost of funds. At March 31, 2012 the cost of funds was 1.27% as compared to 1.52% at December 31, 2011 and 1.61% at March 31, 2011.
"Nearly twenty five cents of every dollar is held in domestic liquid assets to cushion the Bank from a rising interest rate environment. In addition, at March 31, 2012 transaction checking accounts have increased 12.6% from December 31, 2011 and 24.2% from March 31, 2011.
"The Western Montana economy continues to present challenges to the Bank in its efforts to dispose of repossessed property and certain portions of its loan portfolio. Additional write downs of repossessed developed lots may be required to liquidate them in the future if demand for them does not improve. However, recently there appears to be a slight improvement in the Western Montana economy. With this improved economic outlook, positive earnings and the $2.1MM in loan loss reserves the Bank is hopeful that its non-performing assets will continue to decline. We will continue to work diligently to improve the asset quality of the Bank, generate profits to enhance stockholders' equity and retain adequate liquidity in these uncertain economic times."
For more information regarding this release, or the Bank in general, you may contact James A. Salisbury, President and CEO, at 406-543-8700.
About Treasure State Bank
Treasure State Bank, a Montana chartered community bank, is headquartered in Missoula, Montana. The Bank was founded in January 2007. Treasure State Bank currently trades on the OTCBB under the ticker symbol "TRSU". Treasure State Bank serves businesses, professionals, non-profit organizations and individuals through customized banking services and products. For more information, please visit www.treasurestatebank.com.
Safe Harbor Statement
This communication contains statements that may constitute "forward-looking statements" within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995. Those statements include statements regarding the intent, belief or current expectations of Treasure State Bank and members of its management as well as the assumptions on which such statements are based. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those contemplated by such forward-looking statements. Important factors currently known to management that could cause actual results to differ materially from those in forward-statements include fluctuation of operating results, the ability to compete successfully, and the ability to complete before-mentioned transactions. The Bank undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results.
James A. Salisbury
President & CEO
Treasure State Bank
3660 Mullan Road, Missoula, MT 59808